The Five Different Real Estate Investment Options

July 6, 2017

The Five Different Real Estate Investment Options

Real estate can provide an investor with a considerable ROI, if they select the right property at the right time and for the right price. However, as there are many real estate investment types to choose from, you might be unsure of the best options for your needs. For this reason, we are providing a detailed look at five real estate investment opportunities, which will allow you to make an informed decision.

Residential Real Estate

Residential real estate is an investment in either a house or apartment, and the tenants will be either individuals or families. In some cases, they may feature a service business option, such as a full-service building to provide a luxury experience to tenants, or it could be an assisted living facility. The length of a tenant’s stay is usually determined by a rental agreement. Tenant leases commonly run for between six to twelve months, and can therefore quickly adapt to property market conditions more than any other real estate investment.

Commercial Real Estate

Commercial real estate is often leased to businesses or corporations, who are locked into an agreement for many years. One of the best lease options to consider are NNN investments, which allow credit worthy tenants to lease a building for a long period of time. What’s more, they are responsible for a property’s operations, maintenance, repairs, taxes and improvements. Once a tenant’s lease has come to an end, they can either choose to renew a lease, find a new tenant or sell the property for a healthy return.

Industrial Real Estate

Industrial real estate often relates to an umbrella of large scale buildings, which are used as warehouses, storage units, distribution centers, assembly plants or manufacturing. Often, industrial real estate comes with a substantial fee, as well as a service revenue stream, such as by adding a car wash’s coin-operated vacuum cleaner.

Retail Real Estate

Any investor who wants to own a mall or shopping center should consider retail real estate. The property is often acquired by various retail stores, restaurants, hair salons and similar enterprises. It is also possible for an investor to receive a percentage of a store’s retail sales, which is commonly provided to ensure a landlord creates an attractive storefront to encourage foot traffic.

Mixed Use Real Estate

Mixed use real estate is a term given to a property that incorporates various forms of the above real estate investments. For instance, a multi-storey property may feature retail stores and restaurants on the ground floor, office space on the first and second floors, and apartments on the additional floors.

Conclusion

As you can see, there are many real estate options to choose from that could provide a substantial return on an investment. However, you must aim to find the best property, lease agreement and tenants to ensure your success in the real estate market. Research each investment option carefully so you can decide on the right option to suit your financial future.